It’s 2030, and you don’t want to buy a car anymore.

Can you define your industry? I’m sure you can. Can you figure out what shape will it take in five or ten years? …Uhm…

I am always curious about the way every company understand the concept of Innovation, and therefore, the role its Innovation Unit plays in the development of the company.

One of the most outstanding approaches is the concept of Innovation as a way to predict the future, and from this perspective, it doesn’t matter whether the Innovation Unit is a hundred people department or just the CEO reading technology reports on Sunday morning before breakfast. It is more about getting someone looking towards the future.

This role is more relevant on those fast paced environment, where Exponential Innovation is continuously pushing changes up.

The concept of #ExponentialInnovation comes down to the idea that every technological advance, every new technology, as computing capacity for example, is accelerating other technologies. Technology nowadays is growing not linear, but exponentially. According to this idea, the humankind has evolved in the last 100 years as much as in the last 100,000, or in the last 10 years as much as in the last 100.

There are lots of industries where this conceptualisation of Innovation becomes relevant. Automotive industry, for example.

Automotive is one of those sectors where many changes are coming and different technologies converge. In a few years we are seeing how the #electriccars becomes real, hydrogen technology is successfully implemented into cars, the #autonomouscar is almost happening (in fact it works, with some pending points to solve…) and tonnes of new technologies are being incorporated to cars.

Electric car itself is an expression involving many different and complex technologies: electric engines, batteries, battery management systems, charging systems …And all of this is also related to Green Energy, solar panels, accumulators…But also #fuelcells, hydrogen, etc. Every one of these areas is continuously evolving, with new solutions arising every single day.

Also Autonomous car is a complex concept, where many different new technologies comes together (5G, IoT, AI… just to name a few) and every technology is accelerating the others, reaching the next step very fast.

For every decision maker (not only in automotive sector but in any industry, in fact) it is basic to get an idea about how all these emerging technologies – these vectors of change - will shape his industry in five or ten years, what technologies will have a large impact, new stakeholders to arise, regulators, regulations, etc.

The Exponential Innovation has two relevant effects to take into account:

First: As new technologies become relevant in any industry, it makes an opportunity for new companies to enter the business. Whoever is strong in electric engines, batteries, fuel cells or any other relevant technology, can get its own place in the car business now.

Second: The amortisation term for investments is reduced. Since things change very fast, the standard investment systems doesn’t work anymore, the long-term is not viable. Deadlines are getting tighter.

Both aspects becomes threats for traditional companies, both aspects becomes opportunities for new actors.

New technologies require new knowledge: Are your engineers familiar to those new power systems? Are your sales department able to explain the advantages of your approaches respect to other solutions in the market,..?

New technologies require investment: Research, tests, developments… again the whole process, step by step.   

New competitors do not need to get the knowledge, neither a big investment. It is the knowledge they already have and the technological level they have reached what makes them a relevant actor in the Industry.

But the changes coming are deeper, it is not just about implementing new technology, it is about a new concept. In a few years the car will not be any more as we understand it now. You don’t drive an autonomous car, the car drives itself, you just sit there and have a discussion with your car, about where you would like to go, and then the car will make decisions.

Not the kind of discussion I have with my dog, not the kind of discussion my mother has with her Roomba, which are 90% unidirectional. Will be more like a polite conversation between two adults, due to AI.

Every traditional car brand is moving to this new concept, and we can actually see great solutions already in the market: Mercedes Benz EQ, Audi e-tron, i-BMW, Volkswagen, Toyota, Porsche and many others. Every single car company is developing their own solutions, under their own approach to the concept of the car of the future.

Together with them, a good bunch of new companies are arising, where Tesla is probably the more relevant, but not the only one with a new proposal, with a new concept of car.

Brands like Rimac (electric hypercars), Uniti (city cars), Rivian, (electric adventure cars), P?ech,(European heritage sport cars) or Fisker (the world’s more sustainable vehicle) - just to name a few of the hundreds of options available -, are defining different versions of the concept of “car” by incorporating different technologies, in different doses, from their particular perspective. - A lot of fresh air - And for sure all these new actors will redefine the sector itself in different ways. Not only in a conceptual manner, with new interpretations of the idea of what a car is, but also in terms of who are the most relevant actors in the world map of car industry in few years.

But “Car industry“ is not only about cars, companies like Northvolt (Electrification and renewable energy storage) or Skeleton technologies (ultra capacitor-based energy storage) are impacting the industry, providing new technology that habilitate others to move forward.

If you are a CEO in one of these fast paced environment as automotive sector, you’d better make sure to understand how things are going to change.

Actually, I am sure that every decision maker knows his sector in terms of customers, competitors, regulators, etc. And even a couple of Vectors of Change, as the technologies that are going to impact their industry in the next future or are already impacting.

Might be not enough.

The point here is: How do we know that we are being accurate enough when trying to figure out our industry in five or ten years?

Well, you are never sure at all. In fact, all of these business areas impacted by exponential innovation are no longer a static concept, but a live and dynamic ecosystem. That means that we should regularly rethink the boundaries of our Industry

But, How we do that? How can we predict the future? Well, if you have one, you can ask your Innovation Department, that’s what these guys do.

Or you can also try by your own. We can apply a “Derivative Process” to the basic concepts we are using, and see what happens.

As in mathematics we calculate a derivative function from a primary function, and then we can go from first derivative function to the second, we can apply a similar process here.

The way we derivate a concept is just adding, on top of it, a few new technologies, those which are closer to impact that industry. Just get a concept like “bike” and add some technologies, like “electric batteries”, then you get “e-bikes”, simple.

So, considering the concept “Car” as our primary function, through a derivative process we could get “electric, autonomous car” as the first derivative function.  

- Here we are.- Now the boundaries of automotive sector have move to a higher area where new concepts like batteries, or IoT are included, and therefore, affecting the business model of any company in this industry. That means new actors to take into account, new technologies becoming relevant for your industry, new rules to play that match.

This is how you predict the shape of your environment in the next future.

What if we go for the second derivative function? I would say we get “urban mobility solutions” and here we can add concepts like “Car Sharing” or “e-bikes”

Customers get a wider choice, lots of different solutions to select those that more fit their needs, and also very important, the opportunity to change their selection as their needs change.

One of the most relevant changes in the new definition of traditional concepts is the way we relate to those things, moving from “owning things” to a “pay-per-use” or “sharing” models. It works with music, it works with houses. And it is already available for cars. Companies like Link&Co offer different alternatives to use their cars, Bla bla car developed its particular business model for sharing cars, and it works really well from a few years ago, and we could add here lots of different options to rent e-bikes in almost every city.

Ok, What’s next? Well, I would say “Urban Air Mobility (#UAM) Solutions”. And now the shape of the industry changes again: new actors, new regulators, new problems to solve (I mean, opportunities), new solutions available.

Companies like Volocopter, Ehang, Kitty Hawk, Lilium or Vertical aerospace just to name some of them, are already testing their own #e-VTOL solutions, and they works. Also hundreds of other companies are working on their own approaches to Urban Air Mobility. Traditional companies like Boeing or Airbus are also developing their own e-VTOL concepts.

Airbus is working on Autonomous VTOL solutions. And there are a good bunch of interesting collaborations between new and traditional companies: Lufthansa and Volocopter are working already together in the shaping of the air mobility in cities; Ehang is runnig their flying tests at Seoul already

The first approach of some of these companies is the On-demand Air taxi service, but in a few years we will be able to buy our own aircraft, or share it, or pay-per -use it. Maybe we do not need to own a mobility solution anymore.

It is 2020, and all these things are already happening, and in the next ten years lots of new amazing things are coming. 

In 2030 you don’t want to buy a car anymore. In fact, the only reason you had to buy a car is that you couldn’t buy an aircraft, or share it, or pay-per use it. Who wants to drive, when you can fly?

You see what I did? I am reading the future, just looking into my crystal ball.

Can you?